FIRST VOICE Mind Games: OF BUSINESS

FIRSTVOICE
The magazine of the Federation of Small Businesses
OF BUSINESS
October / November 2014 | £2.95 | www.fsb.org.uk
Mind Games:
Protecting your most valuable assets
In this issue:
FSB we
salute you
Celebrations as the
Federation marks
a milestone
Business
wish list
Conferences kick
off FSB election
campaigning
making
change
happen
FSB speaks with
one big voice
fsb news
speaking out for business
Get in touch:
e
f
t
editorial@firstvoice.co.uk
www.facebook.com/federationofsmallbusinesses
@fsb_policy
Manifesto 2015:
Putting the
business voice
FSB mobilises to ensure small business
issues are well to the fore in general
election campaigning.
T
he FSB has fired the
starting gun on its
biggest ever campaign to
shape the political debate
ahead of next year’s General
Election with the publication of its
Business Manifesto.
The 40-page document, which
was unveiled at the three main
party conferences in September
and October, sets out the
measures the next Government
should take to help small
businesses and drive economic
growth.
It highlights what the FSB
believes is essential to:
• deliver a sustained recovery
• rebalance the economy
• create high quality jobs and
full employment
• make all markets work better
together
• lower the cost of doing
business.
“These measures form an
economic plan that will spark
economic growth and job
creation, led by our world-beating
small businesses,” said National
Policy Chairman Mike Cherry.
“But it requires political
leadership and focus on the
pressing issues that small
businesses face right now, and
which will only intensify through
the next five-year Parliament.”
He added that many of
the measures detailed in
the manifesto would cost
the Government nothing to
implement. They are based on
the FSB’s own consultation with
its 200,000 members across the
UK. Where there are costs, such
10 | FIRSTVOICE
as investment in infrastructure,
expenditure would be covered by
the wider economic benefits.
“In the FSB’s 40-year history,
the importance of the selfemployed and small and micro
businesses to the economy has
never been greater,” said Mike.
The manifesto underpins a
concerted and broad-ranging
campaign to reinforce the FSB’s
influence in the run-up to next
May’s election.
“We will be providing a wealth
of resource and guidance for
Regions to engage at every level
with candidates and political
parties, to ensure political
candidates back small business,”
said Ben Baruch, Senior Public
Affairs Advisor.
“We’re mounting a huge
collective effort. There will be
events and hustings in every
Region. We have launched an
FSB election microsite and will be
asking all candidates to share our
#ibacksmallbusiness handle on
social media.”
What will give the election
coverage added resonance is that
the Small Business Bill is currently
going through Parliament and
should have received Royal
Assent by the time Parliament
dissolves.
“Over the months leading up
to the election, small business
issues will figure widely in
political discourse,” said Ben.
“The FSB needs to speak with one
voice across the UK to ensure
candidates back small business
as part of their own election
campaigns.”
Labour:
We will work
harder for
small business
Shadow Minister for
Universities, Science and
Skills, Liam Byrne says FSB
lobbying has ensured small
business is front and centre
of public policy debate.
www.fsb.org.uk
Labour has floated plans to raise the minimum
wage to £8 per hour by the end of the next
Parliament. How would that affect your business?
editorial@firstvoice.co.uk
“W
e know how important
small business is, not
just to the economy,
but the whole ethos of
our country,” said Liam Byrne. “We need a
Government that is going to work harder
for small business.”
The Shadow Minister was speaking in
conversation with FSB Policy Chairman,
Mike Cherry in the first of three FSB
conference fringe events hosted by
the New Statesman magazine. Similar
meetings were also due to be held at the
Conservative and LibDem conferences.
Discussion ranged over many of the
issues highlighted in the FSB’s election
Manifesto, which sets out what small
businesses need to drive the economy
over the next Parliament.
“With confidence being restored and
small firms creating four out of five
new jobs, we need to ensure the next
Government looks into the medium
to longer term and gives sustained,
consistent support for business to grow,”
said Mike.
Small Business Administration
Fielding questions from the magazine’s
Economics Editor, Jon Bernstein, as well
as the audience, Mr Byrne identified sales,
skills and cashflow as the basics which
affect the health of all businesses. He said
Labour proposed policies under all those
headings, adding that what was needed
to bring it all together was a US-style small
business administration.
“We simply do not have a force fighting
on behalf of small businesses in this
country, able to bang heads together, clear
rubbish out of the path and speed things
up. Labour is determined to get one.”
Late payment
Questioned about Labour’s commitment
to dealing with late payment, Mr Byrne
said a Labour Government would look to
shame big companies into fulfilling their
responsibilities by demanding disclosure
of late payments in company accounts.
A more fundamental response
is needed, Mike argued. “It needs
enforcement by Government. Big
companies who say they value their
supply chain, and then extend payment
terms, are not valuing, but abusing their
supply chain.”
Finance
Finance remains an issue, but the recent
launch of the Business Banking Insight
www.fsb.org.uk
A packed room follows the discussion at the
Labour Conference fringe meeting.
initiative (www.businessbankinginsight.
co.uk ) would open new avenues for small
businesses to understand and access
better and alternative sources, said Mike.
Mr Byrne suggested a regional system
of banking modelled on the Sparkassen
system, which could work as well for
business in Britain as it does in Germany.
Local Enterprise Partnerships
A key theme of the FSB’s Manifesto is
rebalancing the economy to drive growth
across all regions of the UK.
Mr Byrne agreed that LEPs need to work
better, and devolving more responsibility
for skills, transport, infrastructure
investment and business support to a
local level would help local economies.
Performance by LEPs was patchy,
Mike agreed. “LEPs must engage with
small business to recognise their ability
to contribute to the debate on economic
priorities.”
Infrastructure
Two important points need to be
stressed on the issue of investment in
infrastructure, said Mike. The first is
that procurement opportunities arising
from HS2 are made accessible to small
businesses. The second is that much
needed investment in extra airport
capacity in the south east must not be
made at the expense of road, rail and air
connectivity in other regions.
He called for an early commitment to
HS2. “It is a big infrastructure decision
which has been on the back burner for too
long, and it’s harming small businesses.”
Mr Byrne said Labour was committed
to HS2, which he described as a
visionary plan: “It will unlock economic
growth in ways we can’t yet imagine.
Infrastructure in this country is creaking,
and it is damaging our ability to export
successfully.”
Employment
The FSB puts the creation of high quality
jobs and full employment at the core of its
Manifesto.
“The skills gap is now mission critical
for Britain,” said Mr Byrne. “It is holding
back growth all over Britain.”
He said two things were needed - local
control over spending on skills, and
radical reform of the system.
“We need a revolution in technical
education. We have set out reform which
means people start vocational education
at 14, do English and maths up to 18, with
a high quality technical baccalaureate
available as well as a radical increase in
apprenticeships.”
Mike agreed that vocational training
needed to be valued as much as academia.
“We must have a medium and longerterm vision to give young people the skills
that small businesses need.”
National Minimum Wage
Referring to an early announcement by
Labour to raise the minimum wage to £8
over the next term of Parliament, Mike
said simply: “We need politicians of all
parties to stay out of this, and leave it to
the Low Pay Commission, which works
incredibly well.”
Mr Byrne argued that low pay meant
a higher tax credit bill which is, in effect,
subsidising mainly large employers.
“When you’ve got workers under
the cosh, you’ve got to take action. But
alongside that you also have to make sure
workers are as productive as possible,
through smarter investment in skills.”
FIRSTVOICE | 11
fsb news
speaking out for business
Help is there
for exporters
Get in touch:
e
f
t
editorial@firstvoice.co.uk
www.facebook.com/federationofsmallbusinesses
@fsb_policy
Victoria Eggs:
Opening new
markets in
Europe and the
Far East.
Open to Export offers new hope to
small businesses looking to expand
into overseas markets.
T
he FSB has
long called on
Government to
recognise that the
needs of small
firms are different to those of
big businesses and to provide
more tailored support.
“There is a strong
opportunity for export growth
if Government assistance and
information is made easier to
access,” says Policy Chairman,
Mike Cherry, who sits on the
board of Open to Export.
The community interest
company was set up by UKTI
in partnership with internet
services provider hibu (UK)
Ltd, in 2012 to help small
firms grow their international
business by offering free
advice from Government and
the private sector. The FSB was
a founding partner.
Open to Export has
thousands of articles and
guides provided by individuals
and organisations with
relevant expertise, covering
every aspect of exporting. It
also hosts regular webinars
and special features enabling
participants to connect directly
with subject matter experts.
“We have a forum where
anyone can post a question
on any topic, no matter how
simple or specific, and expect
helpful responses from the
Open to Export community,”
explained David Lowe, Director
of Operations.
Designer, Victoria Eggs
(www.victoriaeggs.co.uk), has
recently started selling her
own range of British-made
gifts, homeware and greetings
cards in China, Taiwan and
Hong Kong with the help she
received through Open to
Export, and is now looking to
expand into Europe.
“I learned much of what I
now know about exporting
from the website,” she said. “I
read loads of articles, joined
webinars and followed links to
contacts like UKTI.
“I now have a UKTI
representative helping me
research markets overseas, set
up meetings at trade fairs and
deal with all sorts of issues like
exchange rates and shipping.
“The webinars are brilliant.
They’ve helped us find new
ways to market, and improve
our website to make it easier to
buy in other currencies.”
e
Find out more
If you are considering or
already expanding overseas,
register for free advice, webinars
and contacts at
opentoexport.com:
• Get bespoke advice on your
business questions from the
experts
• Contact experts, exporters
and service providers direct
• Receive regular newsletters
with the pick of new contents
• Find out first about
forthcoming webinars and
special features.
FSB presses for smarter approach to roll-out
Over the next five years, smart meters will
be installed in every home and business
across the UK, giving consumers more
control over their energy use.
But while domestic customers will have
access to a full package of advice on using
smart meters to cut their bills, there is no
such programme planned for businesses.
“The whole point of smart metering is
to empower people to cut their energy
consumption,” said Allen Creedy, Chairman
of the FSB’s energy portfolio. “So far, the
smart meter roll-out campaign has targeted
domestic consumers, but for businesses, the
14 | FIRSTVOICE
energy companies are under no obligation
to do any more than install the meters. It’s a
missed opportunity. The energy companies
must go further, providing support and
advice to small business customers on
energy use.
“Smart meters will help customers see
how and where they are using energy, so
they can take informed decisions to reduce
consumption.”
The FSB, working closely with Ofgem,
is urging the Government not to overlook
small businesses, which may have more
complex energy needs than domestic
consumers – hotels, for example – and will
need more help to get the best out of smart
metering.
“We would like an assurance that support
for small businesses will be included in the
roll-out,” added Allen. “Otherwise smart
metering may enable energy companies
to produce accurate readings in real time
(which is a good thing), but do little else to
help small businesses.”
• Have you had experience of smart meters
or other energy efficiency measures? If so,
please share your story with us (andrew.
poole@fsb.org.uk).
www.fsb.org.uk
special report
Intellectual Property
How to stop your competitors
picking your brains. Stefan Volak
reports on how to protect your
intangible assets.
G
raham
Crocker says
he felt sick
the moment
he found an
almost exact
copy of his
invention the Quill Drinker - being sold at
a trade fair. ‘
“Apart from a couple of minor
details, it was identical. It was
being produced and imported
into the UK by a large foreign
manufacturer and sold by one of
our competitors,” says Graham,
who runs Quill Productions,
which produces game and
poultry equipment.
[See story opposite]
Sadly, the experience of Quill
Productions is not unfamiliar.
Thousands of small businesses
each year find their most
valuable assets in the hands of
competitors.
“Business history is littered
with instances of people doing
very nicely out of someone
else’s designs and ideas,” says
John Moore, at Abbey Legal, the
FSB’s legal services provider.
Designs, inventions, branding,
are all what accountants
call intangible assets. And
increasingly, it is these
intangible assets that make the
difference in the market place.
So, how do small businesses
protect themselves, particularly
in the age of instant downloads?
How can you make sure your
competitors are not picking
your brains? For nothing.
“Intellectual property is
valuable. It is what sets your
business apart by offering
something new and different to
the market; provides a revenue
stream and forms an essential
part of your branding and
marketing,” said Mr Moore.
“If you’re a small business,
it’s hugely important to take
steps to prevent competitor
companies using what you
have created without your
permission.
Competitive advantage
If your business hinges on
the technology, processes or
concepts you have developed, it
is imperative you do everything
within your power to protect
that competitive advantage,
by ensuring confidentiality
agreements are watertight
before you start talking to third
parties; and registering
➜
Mind
games
18 | FIRSTVOICE www.fsb.org.uk
Fight your legal battle
Quill Productions, Pulham, Dorset
Isolated: Graham and Trish Crocker of Quill Productions
“Would you
‘come to an
arrangement’
with a thief to
decide how
to divide up
the items
he’s stolen
from you?”
www.fsb.org.uk For the past eight years,
Graham and Trish Crocker
have been locked in a David
and Goliath legal fight with a
company they allege simply
‘stole’ their idea.
Graham’s invention is
a device which dispenses
drinking water hygienically
to game birds and poultry.
He designed it to prevent
cross-contamination of
disease, which was a serious
problem affecting bird flocks
at that time.
Once they realised the
potential of their unique
product, the Crockers set up
Quill Productions at their
farm in Dorset.
Sales took off and the
business grew rapidly, but
within a short time, the
foreign-made drinker was
being marketed in the UK.
“We’d gone to enormous
trouble and expense to do
everything right,” said Trish.
“We developed, tested and
refined the design. And
before we started marketing
it, we patented it in the UK,
France, Italy and America.
Yet here was a product
coming in from another
country that was a direct
copy of ours.”
“It has been crucifying,”
said Graham. “As a small
company, and having paid
so much for the patent you’d
think that you’d have the
support of the Government
or the Patent Office, but
we’ve been left so exposed.
“The only advice we had
from our local MP and a
Government Minister was
to ‘come to an arrangement’
with the company
infringing our patent.
“Would you come to an
arrangement with a thief to
decide how to divide up the
items he’s stolen from you!?
“In fact, we did have a
meeting, and this company’s
managing director as good
as admitted to taking our
design. But he said ‘We’re
much bigger than you. If
you challenge us, we will
suffocate you’.”
Injustice
Despite the warning,
Graham and Trish are
challenging the company
for patent infringement in
the High Court. They feel
a huge sense of injustice
that the effort and expense
invested in trying to protect
their intellectual property
seems to have achieved
nothing.
“The cost in lost sales
and legal fees has been
enormous,” said Graham.
“And we will never get back
the thousands of hours
we’ve had to spend on the
case.
“Why have we paid
those fees to the Patent
Office? And why isn’t the
Government prepared to
do more to help the small
companies it says it is so
keen to support?”
FIRSTVOICE | 19